The National Federation of Independent Business (NFIB), a prominent small business advocacy group in Massachusetts, has released a new health care policy paper titled “Addressing the Health Insurance Affordability Crisis for Small Businesses.” The report highlights significant challenges facing the small-group insurance market nationwide, mirroring issues seen in Massachusetts. According to NFIB, employer-provided health coverage is becoming increasingly unsustainable for millions of small businesses and their employees.
Christopher Carlozzi, NFIB Massachusetts State Director, commented on the situation: “Double digit premium increases resulting in continuously rising health insurance costs are a significant burden for the Commonwealth’s small businesses.” He further noted that health insurance costs have been a primary concern for decades among small business owners. Carlozzi emphasized that recent reforms have exacerbated these challenges by expanding coverage mandates and limiting cost-sharing protections, thus increasing expenses for providing employee health insurance.
The report reveals key findings about the current state of the small-group market. Enrollment has dropped from 15 million individuals in 2014 to 8.5 million in 2023—a decline of 44%. Average premiums have risen sharply over two decades, with single plan premiums up by 120% and family plan premiums by 129% for firms with fewer than 50 employees. Only 30% of small businesses continue to offer health insurance compared to nearly half in 2000. Furthermore, almost all surveyed small businesses expressed concerns about affording health insurance in the next five years.
To address these issues, NFIB proposes several legislative measures including protecting employer-sponsored insurance, supporting targeted tax credits for small businesses, expanding individual coverage health reimbursement arrangements (ICHRAs), improving employer pooling arrangements, and enhancing access to health savings accounts (HSAs). Other recommendations involve protecting access to stop-loss insurance, imposing a moratorium on uniform mandates exceeding ACA requirements, promoting price transparency and certainty, discouraging hospital consolidation, and reducing prescription drug prices through innovation.
For more than eight decades since its founding in 1943, NFIB has been advocating on behalf of America’s small and independent business owners across all states and at the federal level. More information can be found at nfib.com.
